SMBs IN Germany SET TO INVEST US$38B ON IT THIS YEAR

AMI: Germany’s 2.3 million SMBs are on track to spend 7% more on beefing up their

IT infrastructure and solutions in 2006.

After two years of economic stagnation, the German economy is ready to recover, with its base of SMBs (small and medium businesses) leading the way. The country’s 2.3 million SMBs (companies with employees from 1 to 1,000) are on track to spend US$38.1 billion to beef up their info-tech infrastructure and solutions.

Despite the economy's sluggish growth, Germany’s IT industry can expect a sunny and fertile climate for the next two years. SMBs will enjoy glorious moments during the next 12 months. Over 50% of all SMBs will experience an increase in their annual revenues in 2006 and 2007.

Storage & security will drive IT market growth

Demand for security solutions within the Germany SMB space is on the rise. Growing complexity in business operations is inducing Germany SMBs to adopt security solutions. The exposure of critical data stored in networks to customers, suppliers, employees and partners exposes business systems to new forms of malicious attacks, thereby leading to the need to look at solutions that can protect the business. The market is expected to grow at 19% this year.

Storage is the other promising sector which is anticipated to grow at 14% in 2006. The accelerating growth of data has been a major factor in determining storage needs in this business segment. Improved data security and the need for high availability systems are the other influential factors, observes Sengupta.

The study also revealed networking to be the third focus area for Germany’s SMBs. As SMBs’ growth accelerates, these businesses are becoming increasingly dependent on networks to operate efficiently, serve customers effectively, and work with partners and suppliers more collaboratively.

MBs are solidifying their software platform

Medium businesses are in the process of utilizing software to the best capacity. The growing volume of business and transactions is driving the growth of productivity, OS, databases and utilities software. Network security is another factor driving growth. MBs are interested in gaining a competitive advantage by developing and hosting web sites. This has further enhanced the usage of application software among German MBs.

To run their business more competently, Germany’s MBs are connecting departments, speeding up information flow, increasing customer satisfaction and tackling complexities of business. This has given a big push to the growth of enterprise software. Currently enterprise software makes up 14% of total software spending by German medium businesses.

2005-2006 Germany Small Business Market Overview and Comprehensive Market Opportunity Assessment and 2005-2006 Germany Medium Business Market Overview and Comprehensive Market Opportunity Assessment

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